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Wednesday, 24 April 19
SHIPPING MARKET INSIGHT - IS THIS A BANKERS' MARKET? - INTERMODAL
 Over the last 10 years, many of the traditional and top lending banks have made the decision to either downsize their portfolios or even exit shipping. According to Petrofin, Top 40 shipping banks’ lending has fallen since 2008 by 25%, whilst at the same time the world fleet has grown by 28%. On top of this, out of the banks that have decided to stay in the game, not all of them have the strength, the budget and the competitive terms to do so. As a result, the availability of financing for small-medium size companies has become a scarce, hence a luxury good. In other words, even when there is available financing for these companies, its cost is really prohibitive.
Apart from the banks’ endogenous and structural issues, their shipping departments also need to decide where to allocate their budget. In an era of growing LNG demand, numerous large shipping firms invest in the very capital intensive LNG carriers. Most of the large banks are there to support their very good clients. However, this means that a big percentage of their budget (and resources in general) end up to the LNG carriers’ financing, i.e. not much budget left for the remaining sectors/shipping projects. So, when these banks are left with a limited budget to spend, they become very selective and of course their pricing goes up as the list of the waiting finance projects is significant.
But what about the alternative ways of financing for the small and medium size companies? Asian leasing has indeed filled part of the gap that was created with the traditional banks’ exit, however, again this is available for owners with larger fleets and bigger ticket sizes. Public markets have been quiet regarding shipping in general; bond markets again require significant size. Therefore, the small companies are left with the option of the so called alternative financing. Private equity and hedge funds do have the funds to invest, but this only happens when they get the return of capital that they require; given that this most of the times is a double digit figure, then the capital cost for the small/medium ship owners increases dramatically.
There are quite a few new European banks that have joined ship financing – whose pricing sits in between the one of the traditional banks and that of leasing – however, their current budget is nowhere near to filling the gap that was left after the departure of the big banks.
Therefore, small-medium size shipping companies struggle to find competitive finance terms. Someone may argue that this had always been the case, however, in today’s ship finance market it is evident that the financing of small-medium size shipping companies is not the banks’ first priority, which should not be the case given the performance of such companies during recent years. Indeed, many small-medium size companies have proved their top quality and professionalism by not only surviving the crisis but also by getting back into expansion mode. There are many ship-owning companies falling into this category. Indicatively, only in Greek shipping there are more than 150 companies that own 3-15 bulk carriers, of more than 28,000 dwt and younger than 17 years old. A big percentage of these companies are long standing and solid companies; however, face the above finance issues.
This is the clientele that will provide the bank with projects of good credit quality and at the right pricing and therefore should be the one attracting the attention of ship financiers if they wish to make their business efficient and dynamic again.
By George Laios
Deputy CEO, Intermodal Group
Compiled by:
Intermodal Research & Valuations
Analysts:
Ms Eva Tzima
George Panagopoulos
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no reproducing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Friday, 08 March 19
KOMIPO INVITES BIDS FOR 2.6 MILLION TONS OF AUSTRALIAN 5700 NAR COAL FOR FIVE YEARS
South Korea state-owned utility Korea Midland Power (KOMIPO) issued a tender for 520,000 MT of min. 5700 NAR coal of Australian origin to be burnt ...
Friday, 08 March 19
CHINA'S COAL DEMAND FORECAST TO DROP SLOWLY - YONHAP
China’s coal demand is expected to fall at a snail’s pace over the next 20 years due to the country’s preference for the cheap fo ...
Thursday, 07 March 19
INDONESIAN COAL PRICE REFERENCE PLUNGE TO LOWEST IN SEVEN MONTHS
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised down the benchmark price of Indonesian thermal ...
Wednesday, 06 March 19
KOSPO INVITES BIDS FOR 80,000 MT OF 3800 NCV COAL FOR 21 - 30 MARCH, 2019 LOADING
COALspot.com: South Korea state-owned utility Korea Southern Power Co. Ltd (KOSPO) issued a tender for 80,000 MT of min 3,800 kcal/kg NCV low calor ...
Wednesday, 06 March 19
KOREA SOUTHERN POWER CO INVITES BIDS FOR 980,000 MT OF 4600 NCV COAL FOR THREE YEARS
COALspot.com: South Korea state-owned utility Korea Southern Power Co. Ltd (KOSPO) issued a tender for 320,000 MT of min 4,600 kcal/kg NCV low calo ...
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- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- ICICI Bank Limited - India
- Minerals Council of Australia
- Aboitiz Power Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- TeaM Sual Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- Mintek Dendrill Indonesia
- Essar Steel Hazira Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- McConnell Dowell - Australia
- Agrawal Coal Company - India
- Bulk Trading Sa - Switzerland
- Power Finance Corporation Ltd., India
- Chettinad Cement Corporation Ltd - India
- Lanco Infratech Ltd - India
- GVK Power & Infra Limited - India
- Indian Oil Corporation Limited
- The Treasury - Australian Government
- Manunggal Multi Energi - Indonesia
- MS Steel International - UAE
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ambuja Cements Ltd - India
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Bhatia International Limited - India
- Xindia Steels Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Banpu Public Company Limited - Thailand
- Uttam Galva Steels Limited - India
- Standard Chartered Bank - UAE
- International Coal Ventures Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Australian Commodity Traders Exchange
- Straits Asia Resources Limited - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Borneo Indobara - Indonesia
- Indian Energy Exchange, India
- Sarangani Energy Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Bhushan Steel Limited - India
- White Energy Company Limited
- Rio Tinto Coal - Australia
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Meenaskhi Energy Private Limited - India
- PowerSource Philippines DevCo
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- Sindya Power Generating Company Private Ltd
- Posco Energy - South Korea
- Trasteel International SA, Italy
- Savvy Resources Ltd - HongKong
- Indo Tambangraya Megah - Indonesia
- Altura Mining Limited, Indonesia
- The State Trading Corporation of India Ltd
- PetroVietnam Power Coal Import and Supply Company
- Sical Logistics Limited - India
- Medco Energi Mining Internasional
- Asmin Koalindo Tuhup - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- Heidelberg Cement - Germany
- New Zealand Coal & Carbon
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Port Waratah Coal Services - Australia
- Coalindo Energy - Indonesia
- Chamber of Mines of South Africa
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- Sree Jayajothi Cements Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kalimantan Lumbung Energi - Indonesia
- South Luzon Thermal Energy Corporation
- Kumho Petrochemical, South Korea
- Dalmia Cement Bharat India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate Of Revenue Intelligence - India
- Parliament of New Zealand
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Mjunction Services Limited - India
- Indonesian Coal Mining Association
- Carbofer General Trading SA - India
- Africa Commodities Group - South Africa
- Therma Luzon, Inc, Philippines
- Electricity Authority, New Zealand
- Sojitz Corporation - Japan
- Sakthi Sugars Limited - India
- Global Business Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Deloitte Consulting - India
- PNOC Exploration Corporation - Philippines
- Formosa Plastics Group - Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Commonwealth Bank - Australia
- SN Aboitiz Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Ceylon Electricity Board - Sri Lanka
- Indika Energy - Indonesia
- Attock Cement Pakistan Limited
- Globalindo Alam Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Videocon Industries ltd - India
- Bangladesh Power Developement Board
- Billiton Holdings Pty Ltd - Australia
- Price Waterhouse Coopers - Russia
- Bayan Resources Tbk. - Indonesia
- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- European Bulk Services B.V. - Netherlands
- Thiess Contractors Indonesia
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Gujarat Sidhee Cement - India
- OPG Power Generation Pvt Ltd - India
- Interocean Group of Companies - India
- Bukit Makmur.PT - Indonesia
- Kobexindo Tractors - Indoneisa
- IEA Clean Coal Centre - UK
- Siam City Cement - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Grasim Industreis Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Jindal Steel & Power Ltd - India
- Barasentosa Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- GAC Shipping (India) Pvt Ltd
- The University of Queensland
- Wilmar Investment Holdings
- Renaissance Capital - South Africa
- Timah Investasi Mineral - Indoneisa
- Merrill Lynch Commodities Europe
- SMG Consultants - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Central Java Power - Indonesia
- Salva Resources Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Tata Chemicals Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Aditya Birla Group - India
- Malabar Cements Ltd - India
- Orica Mining Services - Indonesia
- Georgia Ports Authority, United States
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Australia Pty. Ltd.
- GMR Energy Limited - India
- Eastern Coal Council - USA
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercuria Energy - Indonesia
- London Commodity Brokers - England
- Intertek Mineral Services - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Edison Trading Spa - Italy
- Star Paper Mills Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Coastal Gujarat Power Limited - India
- Iligan Light & Power Inc, Philippines
- India Bulls Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Karbindo Abesyapradhi - Indoneisa
- SMC Global Power, Philippines
- Jaiprakash Power Ventures ltd
- GN Power Mariveles Coal Plant, Philippines
- Toyota Tsusho Corporation, Japan
- Antam Resourcindo - Indonesia
- Binh Thuan Hamico - Vietnam
- Vedanta Resources Plc - India
- ASAPP Information Group - India
- LBH Netherlands Bv - Netherlands
- Larsen & Toubro Limited - India
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Electricity Generating Authority of Thailand
- Bharathi Cement Corporation - India
- Goldman Sachs - Singapore
- Central Electricity Authority - India
- Makarim & Taira - Indonesia
- CNBM International Corporation - China
- Maheswari Brothers Coal Limited - India
- Baramulti Group, Indonesia
- Independent Power Producers Association of India
- VISA Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Mines - Canada
- San Jose City I Power Corp, Philippines
- Semirara Mining Corp, Philippines
- Ministry of Finance - Indonesia
- Simpson Spence & Young - Indonesia
- Meralco Power Generation, Philippines
- Economic Council, Georgia
- Madhucon Powers Ltd - India
- Australian Coal Association
- Energy Development Corp, Philippines
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Transport, Egypt
- Parry Sugars Refinery, India
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Cement Manufacturers Association - India
- CIMB Investment Bank - Malaysia
- Kartika Selabumi Mining - Indonesia
- Thai Mozambique Logistica
- Singapore Mercantile Exchange
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